South African businesses propping up Mugabe regime

By Tererai Karimakwenda
05 June 2006

Despite Zimbabwe’s deteriorating economy and the political chaos that has created an unstable environment for business investors, South African companies continue to operate in Zimbabwe and now constitute the majority of foreign investment. Attracted by cheap offers from local firms looking for outsiders with foreign currency and by the relatively well-developed infrastructure that still exists in Zimbabwe, many South African companies are taking advantage of the ongoing crisis to gain large stakes in lucrative markets. But they are beginning to face intense criticism because observers say it is their direct investment in Zimbabwe that is propping up the Mugabe regime.

Critics also say the soft stance taken by South Africa’s President Thabo Mbeki towards the situation next door has been guided to a great extent by the needs of the business elite. And all this while ignoring gross human rights abuses, oppressive legislation and state-sponsored violence inflicted on innocent Zimbabweans. Chris Maroleng, a research fellow at the South African Institute of International Affairs who has been following developments in the region said: “The fact that South Africa itself has in the past and is currently, one of the strongest economies on the African continent would mean that the corporate and business interests of the South African elite would play an important part in some of the decisions that South Africa, the South African government, would take into account in determining its overall foreign policy objectives.”

Maroleng admits there are some great opportunities for investment in Zimbabwe despite the government’s delay in signing a bilateral property protection agreement, the illegal seizure of some privately owned businesses and the current threats to the lucrative mining industry that many South African companies have invested in. But he expressed deep concerns about the human rights violations and the lack of concern for the suffering people of Zimbabwe. Maroleng said: “ What we can question within this whole context is why would South African companies be involved in investing in and, in a way, propping up a regime in Zimbabwe which has been accused of human rights violations, which has been accused of not having the interests of the majority of its citizens when considering economic policies. And I suppose these are the tensions inherent in South Africa’s foreign policy and also reflective of the manner in which some South African companies have carried out their business ventures in Zimbabwe.”